Assam chief secretary N.K. Das at the exhibition of currency notes organised by RBI in Guwahati on Tuesday. Picture by Eastern Projections
Guwahati, June 2 : The Reserve Bank of India (RBI) will help set up banks in 49 blocks of the region and meet the revenue costs of the new banks for the first five years.
The state governments of the Northeast had been asked to provide a list of blocks, which do not have banks, to the RBI.
Of the 131 blocks in the country that do not have banks, 89 alone are in the region and thus a large chunk of the population is deprived of banking facilities.
Regional RBI director Surekha Marandi said the bank has offered to fund the one-time capital cost and running cost for these centres for five years under the viability gap funding scheme.
However, the state governments concerned would have to allot the premises and provide appropriate security.
Assam and Mizoram have not provided their list of such blocks to the apex bank.
The viability gap funding basically aims at making the projects become viable and the RBI helps to meet the costs for the first five years.
Many banks are unwilling to start branches in many parts of the region because of the law and order situation.
The Committee on Financial Sector Plan for North Eastern Region had submitted a report to the RBI in 2006, providing details of the development of banking services in the region.
The general assessment was that banking services in the Northeast needed to be upgraded in tune with the Centre’s emphasis on developing the region and a “mission mode” has to be adopted to improve the situation.
Inaugurating a four-day exhibition of currency notes, Marandi said the bank was showcasing the journey of Indian currency notes from the pre-Independence period upto the latest changes incorporated in 2005.
RBI continues to modify the design of banknotes, in terms of design, colour, size and graphics — taking into account the political, cultural and historical legacy of the country.
The apex bank also introduces security features to enable the public to differentiate counterfeit notes from the genuine ones.
In spite of the growing use of credit cards and electronic payment, currency still forms the largest volume of payment instruments even in developed countries.
As of today, the notes in circulation in India is Rs 8,42,472 crore, of which 9 per cent is in the Northeast.
Apart from displaying the bank notes, the exhibition also highlights incidents leading to changes in their design.
Most of these notes have been withdrawn or are no longer in circulation.